MUMBAI, February 15: Hindustan Lever Ltd (HLL) is exploiting synergies which exist in its sales force and that of the erstwhile Brooke Bond Lipton India Ltd (BBLIL).Brooke Bond Lipton's sales force was not merged with Hindustan Lever when the two Unilever firms amalgamated two years ago. Unlike in the case of Pond's India, where the company's sales force was merged with HLL's a few years back, the BBLIL merger was mainly to exploit HLL's financial clout to expand its foods business.
There was no synergy in the product portfolios of BBLIL and HLL -- BBIL dealt in foods and beverages, HLL in soaps, detergents and personal products. Thus the sales force of the two was to operate independently.
However, in the case of Pond's, where the product basket fit well with that of HLL, it was an easy task to merge the sales force of the two and gain from a common sales and distribution channel subsequently.
According to HLL sources, while some synergies exist between the sales and distribution system of HLL andthat of BBLIL, there are also some dissimilarities. The company is looking at exploiting synergies with regards to locational advantages to cut down on overheads.
As against Pond's sales force, which was not very large when merged, BBLIL has a 900-strong force as against HLL's around 600. HLL has close to one million retail outlets, which forms a quarter of the country's total of over 4 million outlets. The number of HLL stockists is 6,800.
At present, Hindustan Lever's stock keeping units do not store Brooke Bond's products. The extent of merger will have to be worked out by the company. The rationalisation programme should take around 2-3 years, sources said.
The initial idea was to bring about the Pond's merger before that of BBLIL. However, that did not happen as the Pond's pricing issue of preferential allotment of shares to Unilever, to maintain the parent company's stake at 51 per cent in the company, posed a road block.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
